Commercialization of the Commons
Research Paper Title:
“The commons: A model for understanding collective action and entrepreneurship in communities”
Authors:
Background:
Access to finance is a powerful tool to alleviate poverty and promote social inclusion. Yet, sometimes microfinance institutions make the situation worst for borrowers who end up in the debt trap. By considering access to finance a basic right, community banks can prevent these pitfalls. In this article, you will learn how Brazilian entrepreneurs mobilize collective action for the establishment, governance and management of community banks. By expressing solidarity and promoting autonomy, these social entrepreneurs promote self-organization and social control to create commons that will benefit the whole community. In doing so, finance becomes a commons, i.e. a resource that is shared, accessible, and collectively owned and managed by communities for collective benefits.
Methodology:
Sample: 5 community banks in Brazil
Sample Size: 63 interviews with bank directors, managers, community leaders, government and private bank representatives
Analytical Approach: grounded theory, inductive qualitative analytical approach
Hypothesis:
Guided by principles of self-organization and right to access, commons are created by entrepreneurs within communities
These principles are enacted through mechanisms of social control facilitated by entrepreneurs
Upward and downward mechanisms align ideology and action to achieve commercialization without commodification
Social entrepreneurs transform financial resources for collective benefits rather than promoting capital concentration
Results:
The author identifies two principles of collective entrepreneurship that are the ideological foundations for commons creation and enable commercialization without commodification. One of the contributions to the literature consists in explaining how these principles are enacted through collective governance and mechanisms of social control facilitated by entrepreneurs. Building a conceptual model for the entrepreneurial creation of commons, the author shows that commons creation requires entrepreneurial action at multiple levels to ensure that principles of self-organization and right to access are present from metaconstitutional to operational level. In doing so, this article addresses knowledge gaps about the creation of commons by examining the critical role entrepreneurs play to facilitate collective action and revealing the downward and upward directionality of community engagement in the creation of commons. Thereby, this research sheds new light on how individual entrepreneurs translate principles into collective practices, and how these metaconstitutional values and ideologies influence collective action.
Conclusion:
The concept of commons provides a new basis for studying collective action in enterprises. Although the practice of sharing has long existed in many societies and economies, the recent surge of interest of entrepreneurs and social actors in reclaiming and creating commons reveals a renewed attention to collectively producing, distributing and consuming goods and services. Understanding how commons are created and commercialized by communities is therefore important for practical and theoretical purposes. Through a qualitative study of five community banks in Brazil, the author abductively derives two principles of collective entrepreneurship that help achieve and sustain commercialization without commodification. One novelty of this research is that it explains how these principles are enacted through downward and upward mechanisms of social control facilitated by entrepreneurs. By applying the idea that access to finance is a basic right, these enterprises make finance more accessible and inclusive for traditionally excluded communities and reveal the transformative power of community governance for the creation of commons.